WASHINGTON – Since the 2016 presidential election, many different factors have been blamed for each side’s electoral shortcomings.

Hillary Clinton continues to blame anything and everything except herself for her loss: Russia, James Comey and the FBI, sexism, cable news, talk radio and incompetent campaign employees, to mention a few.

President Trump, meanwhile, has insisted his deficit in the national popular vote was due to “millions” of people voting illegally.

In addition to winning the Electoral College in a landslide, I won the popular vote if you deduct the millions of people who voted illegally

— Donald J. Trump (@realDonaldTrump) November 27, 2016

Many in the media were quick to ridicule the president for his statement. But recent findings from Judicial Watch indicate the potential for rampant voter fraud in the traditional Democratic stronghold of California.

Eleven counties in California have more than 100 percent of their voters registered to go to the polls.

The only county that Trump won out of these was Lassen County. Hillary Clinton won the other 10 by various margins.

Such inconsistencies in voter-registration lists could have innocent explanations, ranging from the recent death of a voter to someone moving to a new district and not being removed from the voter lists in their old hometown.

However, states are required by the National Voter Registration Act, or NVRA, to conduct regular maintenance of their voter registration lists and remove ineligible or deceased voters. According to Judicial Watch, there is “strong circumstantial evidence that California municipalities are not conducting basic reasonable voter registration list maintenance as mandated under the NVRA.”

Judicial Watch has sent a letter to California Secretary of State Alex Padilla asking him to clean up the state’s voter registration lists. The group threatened to sue the state if officials do not do so in compliance with the NVRA.

The threat of a lawsuit comes on the heels of Padilla’s refusal to cooperate with the federal government in a nationwide investigation into voter fraud.

“California’s voting rolls are an absolute mess that undermines the very idea of clean elections,” said Judicial Watch President Tom Fitton. “It is urgent that California take reasonable steps to clean up its rolls. We will sue if state officials fail to act.”

Over-registration in California counties is not, of itself, proof of rampant voter fraud or a plot to steal elections. However, the numbers do mean that the potential for voter fraud, either by people voting multiple times under different names or by illegal aliens or other ineligible voters casting ballots, is high.

In April, Judicial Watch sent similar letters to 11 states – Alabama, Florida, Georgia, Illinois, Iowa, Kentucky, Maryland, New Jersey, New York, North Carolina and Tennessee – which also have counties in which more voters are registered than eligible.

Judicial Watch also filed a lawsuit against Maryland on July 18 for violations of the NVRA.

Remember when housing prices rolled over in 2006, the sub-prime mortgage industry began blowing up too? After all, the only reason those loans were being made was because housing prices were going up. So once housing rolled over, it was only a matter of time before the sub-prime mortgage bankers blew up.

Well, the same thing that happened to housing in 2006 is now happening in automobiles: prices are rolling over. So the value of the underlying assets is now falling.

Even worse, total vehicle sales have ALSO rolled over. And this is happening despite ridiculous offers such as 0% down and interest free financing.

But it’s probably nothing. I am Janet Yellen has everything under control…

“I Don’t Believe We Will See Another Crisis In Our Lifetime.” Janet Yellen, June 27, 2017

The breathless hype of a nonexistent ‘Russian collusion’ has been the lead news story for almost a full year despite the fact that no one, not the CIA, not the NSA, not the FBI, not the Director of National Intelligence, can find a scrap of evidence…That this led to a special prosecutor shows how totally corrupt justice in America is.

by Paul Craig Roberts,

We should be scared to death that Sally Q. Yates served as a prosecutor in the Justice (sic) Department for 27 years. In the New York Times, Sally takes high umbrage to Trump’s criticism of his attorney general, Sessions, and blows Trump’s disappointment with Sessions into an attack by Trump on the rule of law.

Sally has it backwards. The rule of law is being attacked by the appointment of a special prosecutor to find something on Trump in the absence of any evidence of a crime.

In 1940 US attorney general Robert Jackson warned federal prosecutors against “picking the man and then putting investigators to work, to pin some offense on him.

It is in this realm – in which the prosecutor picks some person whom he dislikes or desires to embarrass, or selects some group of unpopular persons and then looks for an offense – that the greatest danger of abuse of prosecuting power lies.

It is here that law enforcement becomes personal, and the real crime becomes that of being unpopular with the predominant or governing group, being attached to the wrong political views or being personally obnoxious to, or in the way of, the prosecutor himself.”

Robert Jackson has given a perfect description of what is happening to President Trump at the hands of special prosecutor Robert Mueller. Trump is vastly unpopular with the ruling establishment, with the Democrats, with the military/security complex and their bought and paid for Senators, and with the media for proving wrong all the smart people’s prediction that Hillary would win the election in a landslide.

From day one this cabal has been out to get Trump, and they have given the task of framing up Trump to Mueller. An honest man would not have accepted the job of chief witch-hunter, which is what Mueller’s job is.

The breathless hype of a nonexistent “Russian collusion” has been the lead news story for months despite the fact that no one, not the CIA, not the NSA, not the FBI, not the Director of National Intelligence, can find a scrap of evidence. In desperation, three of the seventeen US intelligence agencies picked a small handful of employees thought to lack integrity and produced an unverified report, absent of any evidence, that the hand-picked handful thought that there might have been a collusion. On the basis of what evidence they do not say.

That nothing more substantial than this led to a special prosecutor shows how totally corrupt justice in America is.

Furthermore the baseless charge itself is an absurdity. There is no law against an incoming administration conversing with other governments. Indeed, Trump, Flynn, and whomever should be given medals for quickly moving to smooth Russian feathers ruffled by the reckless Bush and Obama regimes. What good for anyone can come from ceaselessly provoking a nuclear Russian bear?

The new Russian sanctions bill passed by Congress is an act of reckless idiocy. It was done without consulting Europe which will bear the cost of the bill and might reject it, thus sending shock waves through the fragile American empire.

Congress’ thoughtless bill is a violation of the separation of powers. Foreign policy is the executive branch’s arena. The feckless Obama put the sanctions on. Obviously, if a president can put sanctions on, a president can take sanctions off.

Trump should take his case to the American people, not via Twitter, but with a major speech. Fox News and Alex Jones, either of which has a larger audience than CNN and the New York Times, would broadcast Trump’s speech. Trump should make the case that Congress is over-reaching its constitutional authority and also preventing a reduction in dangerous tensions between nuclear powers. Trump should ask the American people forthright if they want to be driven into war with Russia by gratuitous provocation after provocation.

Because of the powers that Bush and Obama thoughtlessly gave the presidency, Trump can declare a national emergency, cancel Congress, and arrest whomever he wishes. Of course, the presstitute media would do everything possible to sway the people and the US military against the state of emergency, but if there were a real “Russian collusion,” Trump would have Putin initiate a major crisis that would bring the people and the military to Trump’s side. That no such thing will happen is total proof that there is no “Russian collusion.”

Even the Washington Post, an initiator and leader of the breathless “Russian collusion” lie has now published an article, “The quest to Prove Collusion is Crumbling,” that concludes that the entire orchestration is a hoax.

As the Washington Post article says, “the story that never was is not happening.”

So the great “superpower America,” the “exceptional, indispensable country,” has wasted 7 months of a new presidency in a hoax when it could have been repairing the relations with Russia and China that were seriously damaged by the criminal Bush and Obama regimes. What are the utter fools that comprise the American Establishment thinking? Why do the morons want high tensions with the two powers that can remove the United States and its impotent European and British vassals from the face of the earth in a few minutes? Who gains from this? What is wrong with the American people that they cannot understand that they are being driven to their destruction? Insouciant America is clearly not a sufficiently strong term.

To come back to the ridiculous Sally Q. Yates, clearly Sally is the embodiment of the Insouciant American. She says she spent 27 years as a Justice (sic) Department prosecutor. Yet, she is able to write this utter nonsense: “I know from first hand experience how seriously the career prosecutors and agents take their responsibility to make fair and impartial decisions based solely on the facts and the law and nothing else”

Where was Sally Q. Yates when US attorney Rudy Giuliani used the presstitute media to frame up Michael Milken and Leona Helmsley? Giuliani never had any valid indictment against Milken but used the media and FBI harassment of Milken’s relatives to force Milken into a plea bargain and then had Milken double-crossed by the bimbo judge, who was denied her reward to the Supreme Court because it came to light that she illegally employed illegal aliens.

Today, thanks to the corrupt American media, 99.9% of people who remember the Milken case think that Milken was convicted of insider trading, a charge for which no evidence was ever presented and which was totally absent from the coerced plea bargain that the media helped Giuliani secure.

As best I remember my investigation of the Helmsley case, Rudy dropped charges against a corrupt accountant in exchange for false testimony against Helmsley. As I remember, both Judge Robert Bork and Alan Dershowitz, attorneys in the case, told me that the charge of tax evasion against Helmsley was preposterous. The Helmsley hotels were fully depreciated and were surviving by guest rentals alone. If the Helmsleys had wanted to reduce their income tax, all they needed to do was to sell their existing depreciated holdings and purchase other hotels in order to crank up the depreciation that reduces income tax.

Whatever Justice (sic) Department case you look at, it stinks to high heaven. It is extremely difficult to find any justice in America.

But Sally is certain that President Trump’s criticism of his weak AG means the end of the rule of law in the US.

As many on the left would say, the US has never had a rule of law. It has a rule of power. How else do we explain the enormous war crimes of the Clinton, Bush, and Obama regimes, and the war crimes to come from the Trump or successor Pence regime, that never will be tried at Nuremberg?

Half of the eight mayoral hopefuls on Detroit’s primary ballot next week have been convicted of felony crimes involving drugs, assault or weapons, a Detroit News analysis shows.

Three were charged with gun crimes and two for assault with intent to commit murder.

Tuesday’s Detroit mayoral primary election is the first since the democrat controlled city exited bankruptcy in 2014. The field of eight will be narrowed to two who will face off in the fall.

Under state election law, convicted felons can vote and run for office as long as they are not incarcerated or guilty of certain fraud-related offenses, or crimes involving a breach of the public trust. The Detroit News reviewed the backgrounds of all the mayoral contenders.

While some refute circumstances that led to their criminal convictions, three said their past is a motivating factor in their decisions to run.

The two who have polled ahead of the field, incumbent Mayor Mike Duggan and state Sen. Coleman A. Young II, the son of the city’s first black mayor, have no criminal records. Nor do candidates Edward Dean and Angelo Brown.

First-time contender Donna Marie Pitts, 58, has multiple felony convictions dating back to 1977, according to court records in Wayne and Oakland counties.

Although she denies wrongdoing in the past cases against her, Pitts is open about her convictions.

Pitts, who says she has a business management degree and experience in carpentry, told The News she wants a “better way of life” for Detroiters.

“I don’t hide it. God has brought me out,” said Pitts, who wants to improve health care services, and tackle crime and work on rebuilding the community. “I hope (voters) don’t look at it as negative but as my experience, and I can help. I want to fight for them.”

Shootout over disputed bill

In 1977, Pitts was convicted of receiving and concealing a stolen 1977 Oldsmobile. She was sentenced to a year of probation.

A decade later, she was charged with two counts of assault with intent to murder and two firearm offenses in connection with two separate shooting incidents on March 24, 1987, Detroit Recorder’s Court records say.
Pitts

According to transcripts, Pitts was involved in a shootout with the owner of a collision shop and auto clinic on Greenfield in Detroit in a dispute over a repair bill.

In September 1987, a jury convicted Pitts of the lesser offense of assault with intent to do great bodily harm, less than murder, in the shooting involving the shop owner as well as a firearm offense. Jurors acquitted Pitts of charges connected to the incident involving the officer.

Pitts was sentenced to three to 10 years in prison, plus two additional years for the firearm offense. She served about four years and eight months and was paroled June 1, 1992, according to the Michigan Department of Corrections.

Pitts had another run-in with police in Troy in September 2000 when she was stopped in a residential neighborhood and arrested for fleeing and eluding and operating a vehicle without a license.

Pitts later pleaded guilty to not having an operator’s license and disobeying a police signal. She was placed on six months probation, which was discharged in September 2001.

Most recently, Pitts was convicted of firearm possession and carrying a concealed weapon under a March 2003 plea agreement stemming from a traffic stop in Dearborn Heights, Wayne County Circuit Court records show.

Pitts was stopped by police on Dec. 2, 2002, on Ford near Norborne for an improper plate and failure to wear a seat belt.

A .38 caliber handgun — which Pitts said belonged to her sister — was found on the front floor board of the truck. She was ordered to serve 40 to 60 months in prison in April 2003. She was paroled in August 2006, according to the Michigan Department of Corrections.

Pitts contends she’s been wronged by the courts and police, and she disputes many of the allegations in each criminal case, saying she was discriminated against.

If elected, she said she will combat “discrimination and racism” and advocate for an overhaul of the justice system.

Despite her past encounters, Pitts said she supports law enforcement: “There’s a lot of good officers. I just ran into a couple bad situations.”

‘Overcharged’ in shooting

Fellow candidate Danetta L. Simpson has a 1996 felony conviction out of Oakland County for assault with intent to murder.
Simpson

The 46-year-old former cosmetologist and salon owner has made past bids for state representative, Detroit’s school board and City Council. Her prior interaction with the criminal justice system, she said, has fueled her desire to seek public office. Simpson said she represents a “new spirit” for Detroit.

“I was a wrongfully convicted felon, overcharged for a crime I did not commit,” said Simpson, a mother of four, who contends the witness in the case “lied on me.”

According to court records, Simpson pleaded no contest to assault with intent to commit murder — any term of years up to life in prison — in exchange for dismissal of a firearms offense.

The incident stemmed from a complaint made by a woman who’d been living with the father of two of Simpson’s children. The woman alleged she’d received threatening phone calls from Simpson and court records say a confrontation later ensued in which Simpson fired a gun. No one was injured.

In court transcripts, the woman accused Simpson of pulling up in a van and screaming at her to come outside. She said Simpson then pointed a gun at her and fired, striking part of a doorway about two feet from where the woman was standing, court records say.

Simpson pleaded no contest on the day of the 1998 trial. She later tried to withdraw it, but her attempts failed. She was put on probation for one year and discharged Sept. 30, 1999.

Simpson said she’s running for mayor to “correct what’s wrong and make it right.”

“I’m not out here just to run for name recognition. I’m someone different. I’m someone new,” she said. “I want to help lift the city independently for the people.”

A ‘frivolous’ conviction

Another candidate, Articia Bomer, a document specialist who touts a culinary background and musical talents, was charged in 2008 with carrying a concealed weapon.
Bomer

Bomer, who put together a five-minute extended commercial and musical CD to promote her bid for office, said she’s running for mayor on a platform of “preservation, restoration and revitalization.” She’s pushing for tax reform, better services for Detroit’s homeless and seniors and tougher penalties for bad landlords.

The 45-year-old said her conviction is “frivolous” and “wrong.” It isn’t her focus and she doesn’t believe “that should hinder me.”

Court records note Bomer was approached by police while sitting in a 1987 Oldsmobile Cutlass parked at the curb in the 9300 block of Whitcomb on July 25, 2008. A search turned up a .38-caliber pistol with four live rounds. Bomer said the weapon was not hers.

She said she had just purchased the vehicle, the prior owner was a gun-carrier and several others had been driving the car.

Ultimately, she was convicted during a bench trial in January 2009 and sentenced to a year of probation and was successful in completing it, records say.

“I want voters to know that they should never judge a book by its cover,” she said. “I am a law-abiding citizen.”

Help for ex-offenders

Candidate Curtis Christopher Greene was charged with a felony at age 19. Greene, an author, said he’s since turned his life around by earning marketing degrees from the University of Phoenix and writing three books.

But Greene, now 32, said his past continues to hold him back. He struggles to find employment and wants to implement programs that will help ex-offenders, like himself, facing similar challenges.
Greene

“I came from a crime-ridden area,” Greene said. “My life, I believe it was very complex growing up.”

Greene was charged in 2004 with fourth-degree fleeing and eluding police during an attempted traffic stop in Harrison Township as well as delivering and manufacturing marijuana.

He was sentenced to 18 months’ probation under the Holmes Youthful Trainee Act, meaning his conviction would be dismissed if he met all probationary requirements. Under the agreement, the fleeing and eluding charge was dropped, Macomb County Circuit Court records show.

Greene violated probation in July 2005 when he was arrested and charged with uttering and publishing a fraudulent check in Gratiot County, a felony.

The case was not prosecuted. Instead, Greene pleaded guilty that September to conspiracy for uttering and publishing and was sentenced to six months in the Gratiot County Jail.

Greene also pleaded guilty to violating his Macomb Circuit Court probation. The violation triggered an extension of his probation term and his youthful trainee status revoked, court records say. He was discharged in September 2007.

The activist and ordained minister previously sought a council seat and is touting a seven-point plan to rebuild Detroit. It addresses jobs, discriminatory lending and access to meaningful employment for convicted felons with academic achievement.

Other areas include blight and a “pie-in-the-sky” vision for a 3-million-square-foot “Mall of Michigan” that would rival suburban shopping centers, he said.

“I believe I’m the one to change the city,” Greene said. “Something put this in my heart to do it now.”

Victim bludgeoned while exercising in the relative safety of her apartment complex’s gym

SEATTLE – A 23-year-old DREAMer in Washington state is accused of brutally raping a 19-year-old teen in her apartment complex’s gym and leaving her with severe facial injuries — including a broken jaw and dangling ear.

The woman ended up stumbling home with missing teeth, a bloody head and wearing only a black tank top, according to court documents obtained by Fox News. She was working out in the gym in Burien, a Seattle suburb, before the June 25 assault and did not know her attacker, police said.

Salvador Diaz-Garcia, an illegal immigrant, called “dreamers” by Obama, who was a recipient of Deferred Action on Childhood Arrivals, or DACA, is now facing second-degree assault and rape charges in the vicious attack. He also faces child molestation charges for assaulting a 14-year-old the same day the rape occurred.

His DACA status has been revoked and he now may face possible (but probably not) deportation, officials said.

According to police, the woman was on the treadmill of the gym at 9:15 p.m. when Diaz-Garcia violently attacked her, police said, leaving her with a broken jaw, a broken nose and her ear partially ripped off.

The victim told police that a month before, her attacker had groped her and then ran away. Diaz-Garcia lived for free in the same apartment complex as the victim, but the two had never met.

He was arrested four days after the attack when witnesses and surveillance footage allegedly captured him watching girls at the complex’s pool just before the attack. Investigators say they found what they believe is the victim’s blood on his pants. A rape kit found DNA on her.

“The state is extremely concerned for the defendant’s brazen, bold, and violent behavior towards young women,” prosecutors said in court documents.

Diaz-Garcia was granted DREAMer status in 2013 and renewed it twice since then, most recently this past January.

Burien passed a sanctuary law in January, but now there’s a backlash. Residents have gathered enough signatures to force a vote on if the city should continue to shield undocumented immigrants. Residents are likely to vote on the issue in November, which could be the first referendum of its kind in the U.S.

“You want to lean toward having this welcoming ‘we want everybody here to be happy and feel safe,’” said Debi Wagner, a Burien councilwoman. “How can we guarantee that if we don’t know anything about people living in our midst?”

The stock market / commodities market / bond market stopped making any sense to me about 6 years ago and I am pretty sure it is due to Robo Traders (aka high frequency trading algorithms).

These robots have forced the general stock market higher and commodities lower.

The big problem is that by jamming the “”markets”” ever higher, the central banks have created an enormous gap between current prices and reality.

An easy to see example of this is the housing market in San Francisco, where average income earners cannot afford average houses — at all. The only way the SF housing market can re-balance to a sustainable level is either for salaries to shoot up massively (while house prices remain flat) or for house prices to fall.

Equities are no different; their prices current suffer from a similar “reality gap”. The same is true for bonds.

The High Frequency Trading computer algos are in complete control of the “”market” action, and play with and off of each other to create massive sudden price movements that have nothing to do with anything except order saturation.

Here is just one tiny recent example of the oil market on the NYMEX:

Starting around 6:30am, oil futures started drifting slightly lower. A little volume came in around 6:40 a.m. and then — BAM! — right at 6:44 a.m. EST, a super spike of volume to the downside occurred. But in 3 seconds it was over. (These are one minute bars so those three seconds are obscured in a full sixty second long bar).

So…8 thousand contracts sold in 3 seconds.

The point being, these volume spikes (especially to the downside) have an intensity that is simply overwhelming for the market structure.

Which is entirely the point of the operation. That’s the very essence of price manipulation.

Let’s try to look at this rationally. Let’s define intensity as “volume of more than 2 standard deviations above the recent 1-hour average, divided by the duration of the volume event.”

If we do this, an analysis of the oil chart above would go like this:

Say the average volume was 200 contracts/min. The normal ‘intensity value’ would be 0, because there are no moments above 2 std before the big volume spike (0/0)

Making a guess of a std of 300 for the normal period, at the height of the spike, the value would be ~7,400. Then divide the 3 second episode (expressed in minutes) and you get 148,000.

So from an intensity value of 0, thing spiked up to 148,000 in a matter of seconds.

And it’s that super out-of-range characteristic that just clobbers the price of whatever is being traded (in this case oil, one of the most widely-traded commodities on the planet).

These blasts destroy the market bid/ask structure in those moments. You have literally zero chance of trading that event as a human, even and especially if using ‘insurance’ like automatic stops.

This means that the “”markets”” have a barrier to entry where the cost is the price of a very expensive arrangement of hardware and software capable of operating at the micro-second level. Humans need not apply.

The markets now belong to the big players (aka big banks and hedge funds) and their very expensive machines.

And they are controlling the market with sudden spikes in volume that basically destroys the current market price and the future market price all with a 3 second slam.

And the reverse is done with the general stock and bond market. Perfectly timed buying spikes soak up supply.

How can a little 3 second selling blip in oil contracts control the entire market price you ask?

Imagine that you are selling eggs at the farmers market along with nine other vendors. There are 500 people wandering the market looking for eggs and other produce. The average sales rate for all 10 egg vendors and all 500 customers is 5 dozen eggs per minute.

The price you can sell your eggs for is set in accordance with the other prices around you. Yours are organic, but small. The vendor next to you has large eggs that are conventional, but larger. And third has small colored eggs from heritage breeds that are free range. Let’s say that the range of selling prices is from $4.00 per dozen to $5.50 per dozen. This is the price for eggs at our farmers market set by supply and demand in the free market in this exercise.

All of a sudden, a giant semi-truck backs up. It’s filled with eggs matching every description of those being sold at our small little market. A bullhorn speaker rises from the roof of the truck and announces that 10,000 dozen eggs are now available for the next 1 minute for whatever price anyone is willing to give him for them, but only for one minute (they want to be in an out before anyone has a chance to ask too many questions about where these eggs came from).

What do you think happens to egg prices over that one-minute window? That’s right, the price gets completely crushed. And what do you think happens to demand for eggs among the 500 potential customers at our market? It’s completely satisfied. So future demand is eliminated and sales volumes decline accordingly.

People are throwing change in their pocket at the semi-truck and grabbing all of the eggs they can carry.

In other words, the “”market”” for eggs got ruined, right there and in an instant. You and the other 9 original egg merchants got thoroughly hosed. you all packed up your eggs and went home because the volume of eggs on offer shot up massively all of a sudden, but once all 500 potential egg buyers had been satisfied, the number of buyers dropped away rapidly. Liquidity dried up.

This shows how it’s possible to have a market with tons of volume, but no liquidity. For the rest of the day there are lots and lots of eggs for sale, but no buyers. And with lots of supply but no demand the price keeps dropping until an equilibrium is met.

That one minute spike controlled the current price and the future price (at least for a few days in the egg example).

The point here is this: The high frequency computer bots now are the market.

They operate according to a set of pre-programmed parameters. If or when those parameters are exceeded, they simply vanish in less than an eye blink. When that happens, prices go wonky as the remaining few algos go wild. Their resulting erratic trading spikes volumes and prices all over the place.

Why This Matters

Maybe you’re thinking, “So what?” Maybe you aren’t a trader and think the hows, whens and whys of the computer algos in the Brave New Market isn’t really of any concern to you.

But it really is. And here’s why.

By virtue of its existence, we know that central banks have these bots and are are highly active traders on these exchanges.

Not one single central bank (yet) reports anywhere in their financial disclosures of being the proud owners of any of the accounts traded on the exchanges. So the details of the situation remain a mystery.

But dependably, every single market decline that began over the past several years has been reversed — usually in the dead of night, and in the futures market — by mysterious injections of capital that then get the HFT algos to follow the trend.

And the Fed is fighting any sort of audit tooth and nail.

The big issue, however, is what might happen if (or rather when) things get ‘out of hand’ and the computer bots cannot be cajoled back into the market because the parameters are just too far out of whack. ‘A major market accident’ is the likely answer.

From Dave Fairtex:

Two weeks ago I went to this lecture by a guy (a physics PhD) on unsupervised machine learning techniques called “reinforcement learning”. In the past, the lecturer had worked for JP Morgan and others on HFT applications. He’s now got this startup, and he was (more or less) recruiting AI/ML people to come work for him.

One interesting question was asked by an audience member: “how do you train your bots for market problems or exceptional conditions?” His answer, informed by years of work in constructing market maker bots, was: “the vast majority of time is spent in ‘normal markets’ and as such, that’s how we train our bots.” Basically, when things get dicey, they just turn them off. I’ve heard that before too, but it was fun hearing it from the horse’s mouth.

And, of course, that’s why we have flash crashes. Also my sense is, there aren’t really enough humans left to make markets in an emergency, since the profits have been all eaten up by the bots – no money to pay the human traders, which would spend 99.5% of their time sitting and looking at the bots doing their work. And the bots have only been trained on “normal situation” operations.

It makes sense. Why train a bot for exceptional situations, when a huge pile of money can be made just on the day to day fluctuations. Not only is finding enough data to train a bot to run during crash situations difficult, testing is problematic, and then of course you have to wait for a crash and see if it actually works. And if there’s a bug, losses could be catastrophic. Better to pull the plug when things get iffy.

So, why does this matter to you? Because today’s “”market”” structure is so completely broken now that a flash crash can happen in any sector, no matter how large. That’s not speculating, that’s established fact.

Once a crash really gets under way, for whatever reason, getting the computer bots back online cannot be accomplished until and unless the markets are within certain operating ranges. That’s just how they are built and designed. So as long as everything is within a certain set of parameters, the bots will participate. But as soon as they aren’t, they’ll all just disappear. When they do, they’ll take literally 99% of the market quotes away and 70% of the trading volume. In an instant.

Someday parameters will be exceeded and the “”market”” will crash. Unless the central banks can manage to become such dominant buyers in the “”market”” that they become the market. Japan’s central bank has already achieved this status in its country’s government bonds and ETF markets.

Who knows? Maybe this is the goal of every major central bank. But if so, then we should be having a robust discussion about how this is no different than printing up money and handing it directly to the very wealthiest individuals and most powerful corporations.

That’s not monetary policy. That’s social engineering.

Who wants to figure out how to satisfy all those state and federal regulations involved in opening a new business when you can earn more by playing the speculation game in the financial “”markets””?

As Adam Taggart wrote recently:

When [the market correction eventually] happens, those who decided to look like an idiot early on and refuse to join the party (i.e., positioning their capital defensively), are going to look like geniuses. They will avoid the heartbreak of loss, and they will have capital to deploy when the dust settles, purchasing quality assets at (potentially historic) bargain prices.